Describing his country's economy as a sinking ship, Greece's prime minister has made a formal request for an international bailout, becoming the first member of the European Union to do so.

The Greek government bowed to pressure from the financial markets and has asked its eurozone partners to activate a $60 billion rescue package.

The International Monetary Fund says it is ready to move "expeditiously" on Greece's formal request for assistance.

"It is necessary," prime minister George Papandreou said.

"It is a national and imperative need to officially request from our partners the activation of the support mechanism which we created in common with the European Union."

Protesters have taken to the streets in Athens after the government asked for billions of dollars of emergency international help.

The plan was arranged two weeks ago in Brussels. It provides for loans of up to $60 billion from eurozone partners as well as $30 billion from the IMF.

Greece's budget deficit now stands at 13.6 per cent of gross domestic product, revised up this week from 12.9 per cent.

Its overall debt is more than 100 per cent of its GDP.

The financial markets ran out of patience long before Mr Papandreou did.

Hours before the SOS call was made, interest rates on greek bonds were at nine or 10 per cent - higher than those of emerging countries like the Philippines and India.

Dr Spyros Economides, a senior lecturer in European politics at the London School of Economics, says the activation of the financial rescue plan was an inevitable conclusion to the Greek tragedy.

"The Greek Finance Minister as late as yesterday was trying to put off the decision by a couple of weeks, suggesting that perhaps by May 9 or 10 a decision would have to be made," he said.

"But the markets weren't having this, and the markets in the last few days have been tempting both the Greek Government and the eurozone finance ministers to show their commitment to this stability package; to this mechanism that's going to rescue the Greek economy, supposedly, but also inevitably rescue the eurozone, which is also at stake."

The euro has been damaged by the Greek crisis and has been struggling along at one-year lows against the US dollar.

The common currency is at the heart of the European Union's concerns about Greece.

Germany would be the biggest contributor of cash from the EU.

The whole idea of providing money to Greece has been deeply unpopular among Germans.

Even now, chancellor Angela Merkel is not prepared to give Greece any financial aid until she is convinced that the country's problems represent a real risk to the whole eurozone.

"We still need to be satisfied that the details of the Greek austerity program are fully approved by the IMF and the European Commission," she said.

"Only then will we know for certain that this isn't just a Greek problem but a threat to the stability of the eurozone.

"So today we can say we will help quickly, but we still can't say what the amount of financial aid will be."

So now uncertainty about the timing of the aid will continue to upset the markets. It will inflame tensions within the population too.

Last time the Greek government said it would have to tighten its budget belt, tens of thousands took to the streets to protest.

This time it will be the EU and the IMF dictating the terms of the country's economic rescue, so it will be no use throwing petrol bombs at the parliament.

Job losses, lower pensions and an overhaul of the health system will all likely be ordered by those who have helped Greece avoid bankruptcy.

They will want structural reform rather than wage cuts and higher taxes.

Now that a precedent has been set, questions are being raised about which country might be next to go cap in hand to the EU.

Portugal is the most obvious one but Italy, Spain and Ireland are in trouble too.

Being members of the eurozone means they cannot devalue their currencies to help regain a competitive advantage.